Work Opportunity Tax Credit

Last Updated: January 20, 2026

The Issue

The Work Opportunity Tax Credit (WOTC) is a program designed to encourage employers to hire people who have difficulty finding work. Eligible workers include various groups such as qualified veterans, ex-felons, and recipients of public assistance programs like TANF, SNAP or SSI. (See IRS website for WOTC groups.)

When employers hire qualified workers, they can claim $1,200 to $9,600 per employee, which is determined by factors such as the employee's group, wages and total hours worked.

The Work Opportunity Tax Credit expired on December 31, 2025. Without legislative action, the credit is not available for employees who started work after that date. Bipartisan, bicameral legislation has been introduced in Congress to not only extend the WOTC an additional five years but also expand it by including military spouses as an eligible group. The bill increases the cap from 40% to 50% of W2 wages and adds a second year of eligibility to claim the credit, which can only be claimed during the first year of an employee’s time on the job.

Retail Impact

Many convenience retailers use the WOTC to help them provide employment for individuals who are having a hard time finding work. Participating in the WOTC program can help retailers strengthen their community by providing job opportunities to those who may otherwise struggle to find employment.

NACS Position

NACS supports the extension and expansion of the WOTC.